Boston Condos for Sale and Apartment Rentals

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Boston condo prices to drop? What the experts say

It’s no surprise that home prices in downtown Boston have increased over the past 18 months due to the COVID-19 pandemic. Problems with low inventory and Boston condo buyers wanting to leave urban areas (Boston suburbs prices have risen faster than the city proper’s) or create better work-from-home situations have driven up real estate in the entire metro area.

This has also been true across the country. However, according to Forbes.com, home prices are starting to drop nationwide, citing increased inventory and buyer fatigue as causes. More likely though, this is just part of the normal season trends we see in the real estate market both locally and nationally every year.

Boston Condos for Sale and Apartment Rentals

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Ford Realty Inc., Boston Real Estate for Sale

Ford Realty Inc., Boston Real Estate for Sale

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Updated: Boston Real Estate 2021

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Boston condo prices to drop? What the experts say

A worldwide pandemic and an economic recession have had a tremendous effect on the Boston condo for sale market. The uncertainty brought about by both has made predicting consumer behavior nearly impossible. For that reason, forecasting Boston real estate prices have become extremely difficult.

Normally, there’s a simple formula to determine the future price of any item: calculate the supply of that item in ratio to the demand for that item. In the Beacon Hill condo and Seaport condo market right now, demand far exceeds supply. Mortgage applications to buy a home just rose to the highest level in 11 years while the inventory of homes for sale is at (or near) an all-time low. That would usually indicate a strong appreciation for home values as we move throughout the year.

The Real Estate Experts Take

Some experts, however, are not convinced the current rush of purchasers is sustainable. Ralph McLaughlin, Chief Economist at Haus, explained in their June 2020 Housing Market Forecast why there is a concern:

“The upswing that we’ll see this summer is a result of pent-up demand from homebuyers and supply-in-progress from homebuilders that has simply been pushed off a few months. However, after this pent-up demand goes away, the true economic scarring due to the pandemic will begin to affect the housing market as the tide of pent-up demand goes out.”

The virus and other challenges currently impacting the real estate industry have created a wide range of thoughts regarding the future of home prices. Here’s a list of analysts and their projections, from the lowest depreciation to the highest appreciation:

We can garner two important points from this list:

  1. There is no real consensus among the experts.
  2. No one projects prices to crash as they did in 2008.

Boston Real Estate and the Bottom Line

Whether you’re thinking of buying a downtown condo or selling your high rise condominium, know that home prices will not change dramatically this year, even with all of the uncertainty we’ve faced in 2020.

Boston Real Estate for Sale

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Ford Realty Inc., Boston Real Estate for Sale

Ford Realty Inc., Boston Real Estate for Sale

Click to View Google Review

Updated: Boston Real Estate 2021